BAT Industries had long been involved in Formula One for many years, with several of its companies adorning the bodies of F1 cars. In 1997, the corporation was convinced by Craig Pollock to purchase a Formula One team. This team would be Tyrrell, and BAT and Pollock would use £30,000,000 (approximately $47 million U.S.) to acquire the team during the offseason of that year. The team officially was still Tyrrell in 1998 before it became BAR the following year.

Pollock was the team's principal and was able to lure World Champion Jacques Villeneuve away from Williams for the 1999 season with a lucrative contract. Pollock had managed him throughout his racing career so perhaps it was only natural that he signed on. Joined by F1 rookie Ricardo Zonta, Pollock bragged about the team's success in its maiden year. However, the team was an outright disaster and failed to score a point in the constructors championship, Minardi was even able to outscore them. Villeneuve started the year with 11 straight retriements, and failed to finish a race until the Belgian Grand Prix that August, while Zonta missed 3 races due to an injury and managed only a best finish of 8th himself. Adding insult to injury, figuratively speaking, Mika Salo filled in for Zonta while he was hurt and provided the team's best finish of 7th.

Running on Supertec engines (rebadged Renault engines) in 1999, it still managed to get a contract to run Honda engines in 2000 despite team struggles. The new Honda driven cars did show improvement, proving to be more reliable and slightly more competitive, but the team only had a best finish of 4th. While it was a marked improvement on its first year, with the team finishing tied for 4th in the points, it was still not the kind of year envisioned by team owners. Villeneuve reached the podium twice in 2001 for BAR, but neither he nor new teammate Olivier Panis did enough for the team, and it led to the sacking of Pollock from the team.

David Richards then took over as principal of the team but the story has been the same for BAR, with Villeneuve still struggling to score points and Panis and later Jenson Button doing the same. Villeneuve's failure to produce eventually led to him being replaced at the end of 2003 by Japanese driver Takuma Sato. The 2003 chassis was considered to be one of the best in the field, but the team struggled due to being on Bridgestone tires. In the off-season, they changed to rival tire company Michelin, in the hope to release the potential of their car.

Early in 2004, the team saw an upswing in its fortunes, with Button scoring many podium finishes and also their first pole position at San Marino. BAR was a contender for second place in the Constructors' Championship. Despite wranglings over the future of Jenson Button (both BAR and Williams believed they had a contract for Jenson Button for 2005), both the team and Button himself showed professionalism by putting such matters behind them when they were racing.

With BAR having won the battle over Jenson Button, the line-up will remain the same for the 2005 season.

The team's pitwall control center, from which the team managers and strategists communicate with the drivers and engineers

With increasing restrictions being placed upon tobacco companies' opportunities to advertise in Formula One, rumours have suggested that BAT would try to sell the team. In mid-November 2004, BAR announced that Honda had purchased 45% of the team. As a part of the deal, David Richards left his job as team principal.

On May 4, 2005 the BAR-Honda team was banned by a court of four independent judges for two races in the FIA Formula 1 World Championship. They were alleged to have competed with illegal cars in the preceding San Marino Grand Prix on April 24. The allegation was that the cars have been able to go with a weight below 600 kg (1323 lb), the minimum weight required for a Formula 1 car. BAR-Honda disputed this saying that the engine requires a minimum of 6 kg of fuel to work, keeping them above the minimum weight. Their interpretation of the rules was that this limit applies only during the race, not during the post-race scrutineering. The FIA, and later the court, disagreed. The was disqualified from the San Marino Grand Prix, losing the points gained from that race, and were suspended for the following two races. This means that BAR-Honda will sit out the Spanish Grand Prix on May 8, 2005 and the Grand Prix of Monaco on May 22, 2005. The team first indicated that they planned to fight the decision before a regular civil court but has now decided to accept the verdict. Max Mosley, the president of the FIA, saw the result as very lenient as they had wanted the team to be banned for the remainder of the season. They were, however, unable to prove deliberate intent to cheat. (Official Court of Appeal Decision (PDF) (http://www.fia.com/resources/documents/1024513021__05_05_2005_TAI_Decision.pdf))